State Prosecutor Moshe Lador has ordered the “Leumi Affair” case against outgoing Prime Minister Ehud Olmert closed for lack of evidence. Sources in the Prosecutor's office said the evidence had raised suspicions of improper behavior, but nothing could be proven.
The charges in the Leumi Affair involved suspicions that in 2005 Olmert, then serving as Finance Minister, tried to change the terms of the sale of state shares in Bank Leumi in order to benefit two of his friends who were in the bidding. The friends later dropped out. Police alleged that if the sale had gone through under Olmert's revised terms, the state would have lost $250 million.
Olmert argued that terms are often changed during bidding. He denied seeking to enrich his associates. The changes were meant to encourage more investors to bid, he said.
Lador said there appeared to have been a conflict of interests in the sale. However, he said, the case was criminal in nature and prosecutors would only indict if they could prove the charges beyond a reasonable doubt.
Olmert's spokesman Amir Dan said other investigations into Olmert's alleged criminal behavior would be closed as well. “From the day this affair began two years ago, the Prime Minister said this case would be closed, but nonetheless he was attacked and accused.... The Prime Minister is convinced that this will be the result in other cases as well.” Olmert is still under investigation for several alleged offenses.
The Leumi Affair was first revealed by former General Accountant Yaron Zelicha. After he revealed the affair, Finance Minister Ronnie Bar-On announced that the state would not renew his contract. State Comptroller Micha Lindenstrauss fought Bar-On's decision and assembled a committee to investigate the attempt to terminate Zelicha's service, but Zelicha decided to step down of his own accord. “Ever since I exposed the Bank Leumi affair I have not had a single day of peace,” he said in his resignation address.